The commander of the fourth military region, Major General Mahmoud el-Subaihi on Tuesday said that his forces were using tanks to surround about 70 militants who are taking cover in residential homes in the provincial capital city of Hawtah in Lahj province. Dozens of families from the impoverished city have fled due to violence in the past 24 hours.

Militants from across Yemen, particularly areas where they are active in the south, arrived in Hawtah over the past day to fight the army for control of western neighborhoods of the city, security officials said. The battle there between militants and the army killed three soldiers, one of them by sniper fire. Four others were wounded, according to the officials who spoke anonymously in line with regulations.

In a meeting with military leaders and local council members on Tuesday, Lahj Governor Ahmed Abdullah el-Mejeedi called on residents to cooperate with authorities in reporting any militant movements and to stand on the side of their "sons" in the military. He said that the militants wish to spread fear.

The killings come as Defense Minister Major General Mohammed Nasser said that the terrorist threat in Yemen has become "limited" and that the military is dealing with it firmly, according to Yemeni state TV.

The US considers the local Al-Qaida branch, also known as Al-Qaida in the Arabian Peninsula, to be the world's most active.

An accelerated use of drone strikes in Yemen under President Barack Obama and a US-backed offensive last year drove militants from territory they had seized a year earlier during Yemen's political turmoil amid the Arab Spring.

In total, there have been nine suspected US drone strikes in Yemen since July 27. The drone attacks in that two-week period have killed a total of 38 suspected militants in Yemen, the Arab world's most impoverished country.

Last week, Washington closed 19 US diplomatic missions in the Middle East and Africa. US officials said shutdowns were triggered by the interception of a secret message between al-Qaida chief Ayman al-Zawahri and Yemen's al-Qaida leader about plans for a major attack. Security has been beefed up in Yemen's capital, particularly around embassies.